With the expansion of the cryptocurrency market, several pension funds are starting to look at Bitcoin (BTC) and other virtual currencies. This time, the Houston Firefighters’ Relief and Retirement Fund decided to invest in Bitcoin and Ethereum, the two largest cryptocurrencies in the world. This is one of the first pension funds to invest in digital currencies.
Houston Pension Funds Invests in Bitcoin (BTC)
The Houston Firefighters’ Relief and Retirement Fund that handles over $5.5 billion in assets has decided to make a $25 million investment in BTC and ETH. This would let the pension fund get exposure to virtual currencies.
The decision made by Houston Firefighters’ Relief and Retirement Fund shows that there is a large interest in virtual currencies. Moreover, this could be one of the first pension funds that are starting to invest in digital currencies.
One of the main reasons could be related to the fact that we are currently experiencing a situation in which we have low-interest rates and high inflation. Thus, this is the worst combination for pension funds that could be losing against inflation in some cases.
Bitcoin and digital currencies appear as an alternative investment that could provide pension funds with better returns in the long term. Let’s not forget that Bitcoin moved from $3,180 in December 2018 to over $66,000 in October 2021. This represents a 1,975% price increase in just a matter of years.
Some experts believe that with the current adoption of Bitcoin and future trends, it might be possible for Bitcoin to reach $100,000 and surpass even higher levels (close to $250,000). This provides pension funds with an alternative investment that has the possibility to outperform most traditional investments right now.
For an ageing population that is retiring, it is important for them to know that their future is protected rather than devaluated. US inflation expectations reach the highest level in more than a decade. This could also be one of the reasons why pension funds are searching for new investment options that would bring better results to their investments.
Currently, Bitcoin is being traded at around $61,000 and it has a market capitalization of $1.15 trillion. This makes Bitcoin the largest cryptocurrency in the world. BTC is followed by Ethereum, which has a market valuation of $477 billion and it can be purchased in the market for $4,040 per coin at the time of writing.